Government raises concerns over council finances

The government has written to Shropshire Council outlining concerns about the authority's financial situation.

In a letter to chief executive Tanya Miles, the government said action was necessary to address concerns "transparently and at pace" and there would be a review in 12 months.

It outlined five steps for improvement, including more permanent leadership, the savings to be found and quarterly updates, especially after the authority received 'exceptional financial support' from the government in February..

The Liberal Democrat administration running the authority said the financial problems it inherited last May were worse than expected, but the situation has stabilised since then.

In the letter James Blythe, deputy director for local government stewardship and interventions, said ministers remained concerned.

He said this was due to a number of factors, including the deterioration in the council's assessment of its financial position since it received the extra financial support earlier in the year.

Blythe also pointed to concerns over the council's ability to get value for money and a "historic pattern of weak financial management and internal controls".

At the same time, he said the government recognised the council's commitment to improve and he said: "The council has engaged constructively with us about the challenges it faces."

But he warned that if it failed to demonstrate continuous improvement the government may consider further action.

Council leader Heather Kidd, said: "This notice underlines the seriousness of the council's position inherited from the previous Conservative administration."

When her party took over last year, she said, it found the finances "in a far worse position than we expected" and immediately called in the Local Government Association to do a complete review.

She said the letter showed the magnitude of the challenge facing the council "but also recognises the many steps we are taking to rectify the situation".

This news was gathered by the Local Democracy Reporting Service which covers councils and other public service organisations.

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